Verizon threatens to sue Netflix in war of words over video quality

Verizon Communications has threatened to sue Netflix after the video streaming company started displaying error messages that blamed Verizon for low-quality video streams.

In a letter Thursday to Netflix's General Counsel David Hyman, Randal S. Milch, Verizon's general counsel referred to reports that Netflix was displaying messages to users that the "The Verizon network is crowded right now" and that Netflix was adjusting the video for smoother playback.

There is no basis for Netflix to assert that issues relating to playback of any particular video session are attributable solely to Verizon, according to the letter. Traffic on the Internet can be affected by other factors such as Netflix's choices on how to connect to its consumers and deliver content, interconnection between multiple networks, and consumer-end issues such as home wiring, Wi-Fi and device configuration, it added.

Citing the Internet Phenomena blog, Verizon said that instead of using its ability to connect directly to every broadband network in the country, Netflix has tried to cut costs by relying on a "panoply of content-distribution and other middle-man networks" to reach customers.

"This is about consumers not getting what they paid for from their broadband provider," Netflix said in a statement Thursday. "We are trying to provide more transparency, just like we do with the Netflix ISP Speed Index, and Verizon is trying to shut down that discussion."

A Netflix spokesman said the company is testing ways to let its consumers know how their experience is being affected by congestion on their broadband provider's network.

"At present, we are testing in the U.S. in areas serviced by many broadband providers," he wrote in an email. "This is a small test with a couple hundred thousand Netflix members that started in early May and it is ongoing."

The source of the buffering problem faced by Netflix customers is almost certainly not congestion in Verizon's network, but most likely congestion on the connection that Netflix has chosen to use to reach Verizon's network, David Young, Verizon's vice president for federal regulatory affairs, wrote in a blog post on Wednesday.

Verizon and Netflix came to an agreement recently that would bring Netflix content directly onto the Verizon network.

Netflix has been a strong supporter of net neutrality and has opposed prioritization of Internet traffic by ISPs. "Without strong net neutrality, big ISPs can demand potentially escalating fees for the interconnection required to deliver high quality service," it said in March in a blog post. When it pays "toll" to powerful ISPs, Netflix said it does not pay for priority access against competitors, but just for interconnection, referring to an interconnection deal with Comcast in February.

Young said in his blog post that the current dispute between Netflix and Verizon had been "conflated" with the net neutrality issue. The war of words between the two companies will likely increase, though Verizon is threatening to take the dispute to court as well.

Besides asking Netflix to cease and desist from further providing the notices to its customers, Verizon has threatened legal action if Netflix does not provide a list of its customers on the Verizon network to whom it has delivered the messages along with the date and time of display and the "purported substantiation" for the message.